Illegal -- but Essential

Experts say undocumented immigrants are a driving force in the economy, despite a toll on public services and unskilled workers

Shortly after dawn, the day laborers began gathering beneath a San Diego Freeway overpass in West Los Angeles.

A house painter pulled up in a pickup, looking for an assistant. He offered $12 an hour. A worker jumped in.

Next to arrive was a white-haired woman driving a Honda. Her garden needed a makeover. She'd pay $11 an hour. She departed with a second worker.

On the freeway above, commuters were heading to offices in Century City and El Segundo. Down here, at the West L.A. Community Job Center, arrangements were being made to remodel their living rooms, landscape their yards, rebuild their decks.

The work is undertaken by men from Mexico and Central America. Most are in this country illegally. The jobs, which last only a day or two and pay cash, are all but invisible to the state and federal governments. No one has to fill out paperwork, follow safety regulations or pay taxes.

Yet what happens here is far from marginal. The jobs that flow out of this day-laborer hiring spot -- and from thousands of others around the state, some as informal as a street corner -- are a pillar of California's economic strength.

To see why, check out Adrian Lopez, 20, who is kicking around a soccer ball as he waits. Lopez, who came here from the Mexican state of Oaxaca, is carrying in his Everest backpack a Sony Walkman from the Best Buy across the street.

It's got a CD by the Argentine group Los Enanitos Verdes inside, bought at a Ritmo Latino store. He has a bottle of Kirkland Premium Drinking Water, purchased at Costco, and a spare Old Navy shirt. He likes the grilled steak at Baja Bud's. He wasn't impressed by "Monster House."

"Immigrants buy everything here," Lopez said in Spanish.

The presence in the United States of Lopez and 12 million other illegal immigrants is one of the most contentious issues of the era. Hundreds of thousands of immigrants have repeatedly demonstrated this year for legal recognition, sparking a backlash from many native-born Americans. Congress has been stalemated between legalization advocates and those pushing punitive measures.

Economists are less divided. In the main, they say the American engines of industry and commerce have always been fueled by a steady supply of new arrivals. Immigrants, they contend, contribute to consumer spending and, instead of replacing native workers, create jobs.

"Overall, immigration has been a net gain for American citizens, though a modest one in proportion to the size of our $13-trillion economy," 500 economists wrote in an open letter to Congress on June 19.

Measuring the contributions of illegal workers is a difficult task, however. Many numbers are vague or open to dispute. A few experts contend that the gains are not clear-cut and that any benefits are far from being universally shared.

Special interests that benefit from immigrant labor -- including agribusiness, restaurant operators and unions courting new members -- tout their gains as gains for all, said Michael Teitelbaum, who was vice chairman of the bipartisan U.S. Commission on Immigration Reform in the 1990s.

"It all comes down to where you sit," said Teitelbaum, a demographer at the Alfred P. Sloan Foundation. "The upper tiers benefit from immigration, and the lower tiers lose."

The 500 economists concede that a "small percentage" of native-born Americans may be hurt by competition from illegal immigrants who are willing to work cheaply. But any harm, they say, is outweighed by the benefits to the overall economy.

Lopez is a case in point. Start with his willingness to work for little. Add his eagerness to spend. Multiply that by the more than 2 million illegal workers in the state.

One result: Restaurant prices are pushed down by illegal labor in the kitchen, fruit and vegetable prices by illegal field hands, new-home prices by illegal drywallers.

Immigrants aren't just a weapon against inflation. The tens of thousands of illegal nannies in the Los Angeles area, for example, lower the cost of child care, freeing mothers to return to work. This in turn increases families' incomes, which encourages spending and fuels the economy.

Many immigrants send a portion of their earnings home to their families, but their influence here remains potent. The Economic Roundtable, a Los Angeles think tank, estimates that the 400,000 illegal workers in L.A. County spend $5.7 billion annually on food, rent, transportation and other necessities.

The sales taxes they pay on all those consumer purchases boost the state treasury. The growing number of immigrants who use false papers to get payroll jobs are contributing to Social Security without the right to receive payments from the fund.

That props up the beleaguered system by at least $5 billion a year, analysts say.

Other benefits may be less obvious, such as the gains in property values enjoyed by homeowners.